Ryman Healthcare is still being tipped as a good investment, despite its share price bouncing off record highs to what analysts are now calling "fair value".

The retirement operator's shares rose nearly 68 per cent last year to peak this month at $4.80.

The stock has since slipped to $4.53 as investors book profits on what appears to be the belief that sentiment has outstripped the firm's fundamentals.

However, equity analysts remain upbeat about Ryman's prospects, and see earnings bolstered by momentum in the housing market and cashflow from growth in existing villages. Of six analysts polled by Reuters, three rate the stock as "buy", two as "hold", and one as "sell".

The head of private wealth research at Craigs Investment Partners, Mark Lister, said he viewed the stock as fully priced with a price-earnings multiple of 17, but still viewed Ryman as an "outstanding company" set to deliver earnings and dividend growth in the year ahead.

That was partly due to its building spree in 2007 and 2008, with those completed villages generating maximum cashflow from services and the resale of units on a depreciated basis now that the sites had entered their 5th year.

A private investor in the New Zealand retirement sector said the cashflow, in conjunction with construction of new villages, was providing "serious inertia" to Ryman.

The firm, along with other village operators, was also benefiting from the recovery of the housing market, Forsyth Barr analyst Jeremy Simpson said. Retirees looking to enter villages typically sold their houses to pay for occupation rights. The buoyant property market, particularly in Auckland and Christchurch, was improving the affordability of those purchases, he said.

"A recovering housing market, with more confidence and activity, that's helping with the momentum of the aged-care businesses we've seen in the last year," he said. "It's enabled some of the operators to reduce vacancy levels."

The stock was not without its risks, Lister noted, with the firm forging ahead with development of its first overseas village, in Melbourne. "In New Zealand they do all their building in-house, and they do it cheaper than anyone else. In Australia, because it's their first go, they'll have to outsource that activity, at least initially, which means they don't have their cost advantage."

Lister was confident the risks in overseas expansion were tipped to the upside because of Ryman's proven ability to deliver.